UK - Local authority pension funds prefer fixed income specialists over a multi-manager approach, and favour processes and people over performance, according to new research from Fidelity.
The fourth annual Local Authority Pension fund Marketplace Questionnaire reported that between 2004 and 2007, the amount of funds appointing specialist fixed income managers grew from 40% to 60%.
Meanwhile, pension funds choosing multi-managers fell from 40% to 17% during the same period.
Fidelity added that the number of local authority funds using just one external manager rose from 33% to 46% between 2004 and 2006.
Furthermore, 83% of respondents cited that a fixed income manager’s process was a key factor during the selection process, which was a 10% increase compared to four years ago.
A total of 77% of those surveyed also stressed the value of people compared to 46% in 2004, when it came to managerial selection, rather than just making a decision based on investment performance.
Investors, driven by depressed interest rates, slower global economic growth and rich equity market valuations are examining non-traditional investment opportunities.
The registration deadline for the Workplace Savings & Benefits Awards 2019 is today.
This week's top stories were the DWP giving the green light to CDC and TPR granting extensions for 11 master trust authorisation applications.
Susan Martin says building strong foundations for business are the only way forward as the pensions industry is radically shaken up